With the battle for the digital services dollar intensifying,
small and independent lab owners often find themselves hard-pressed
to remain competitive and gain customer loyalty. There are,
however, several vendors offering a range of turnkey solutions they
can use to lure customers back into the store.

On the service front, a number of companies now specialize in image
restoration and manipulation services for the dealer. A lab that
can't afford a staff artist will find these programs are a
cost-effective way to expand services and add a new profit
center.

It's a good bet everyone who steps into your store has at least one
cherished photo they'd like restored. If you don't have the time
and tools to take on that work or can't afford to employ a staff
artist, you'll send that business elsewhere.

Several companies now specialize as outsource providers of such
services to imaging retailers, offering an attractive price that
still leaves room for comfortable margins. Some of these web-based
operations maintain staffs in foreign countries where the cost of
labor is significantly lower, passing along some of the savings to
the retailer.

For instance, a national network of labs and minilabs now offer
photo restoration services, which they purchase at wholesale prices
through Hollywood FotoFix (www.hollywoodfotofix.com). The company promotes this
network with a store locator wizard on its website.

"What we offer is a turnkey profit center in photo restoration
services," explains Michael Waters, vice president of business
development. "These retailers become partners with us in our
business. They take the work in from their customers, scan the
photo, and upload the digital file to us over the Internet. We
complete the work as specified and back to them with a quick
turnaround."

Retailers pay a wholesale price per image, ranging from $10 to $33
depending on the amount of work involved, and can charge whatever
their market will bear for the services. "Pricing is entirely up to
the local retailer," Waters stresses. "We can provide them with
material to promote the services, but they decide what to
charge."

A combination of factors enables the company to price the services
so aggressively. Waters says the company has restored more than
150,000 photos to date, giving it insight into the amount of work
involved on digital restoration projects. "You can tell your
customer exactly what it will cost when they bring in the photo,
not an estimate of what it might cost," he says.

By shipping the work offshore, where the cost of labor and living
is substantially lower, the company is also able to contain costs
and pass along the savings. Waters says all files are uploaded to
the company's facilities in Lima, Peru, where it maintains a staff
of 120 artists. They complete the work and ship the files back over
the Internet to the retailer for printing.

Another company, Online Photo Fix (www.onlinephotofix.com), offers photo restoration
services over the Internet from facilities in Argentina. According
to company founder and director Alejandro Cerutti, the services are
currently offered through more than 100 retail locations in the
U.S. Dealer cost ranges from $4.95 to $29.95 per image.

PhotoTLC (www.phototlc.com) also leverages the global reach of
the Internet to provide photo restoration services to clients
throughout North America, Europe, Asia and the South Pacific. The
company reports it has restored more than 220,000 images to date.
Services include photo restoration, colorization, or digital
editing and manipulation to create an entirely new image. Clients
pay a flat fee of $59.95 per image, regardless of how many services
are required to produce the desired image.

Bellamax (www.bellamax.com) offers a photo manipulation retail
service that enhances digital images for the consumer. Prices range
from 49 cents to $2.99 for the premium service. Bellamax does the
restoration work and sends it back to the customer. The
photofinisher gets a percentage of each print, as does Bellamax.
The service is digital to digital, so they don't print it. Instead,
they're attempting to attach to output stations such as the Sony
ImageStation, where customers can click a check box that they want
their photo enhanced.

More Software Solutions
A variety of software programs and applications are also available
to help retailers differentiate themselves from the competition and
to give customers a reason to return to the store. Some of these
are software applications for organizing, viewing or sharing
digital images that retailers can sell their customers. Others are
specialized applications, which the retailer can use to promote the
lab and services.

Callisto Software (www.photoparade.com) offers several imaging
applications that consumers can purchase to enhance enjoyment of
their digital images. The flagship product, PhotoParade Maker,
allows them to improve digital images and then share them in
digital slide shows created with the software.